Resource Management

Resource management is the pre-planning, scheduling and resource allocation method for maximizing the effectiveness. Resource management needs a thorough knowledge of your goals and ability, and it needs transparency. By setting up a healthy resource management process, you can maximize effectiveness and monitor the use of those resources easily.

As part of project management, resource management aims to do more with less. Consequently, resource management is focused on effectiveness and optimization. You can efficiently plan the ideal manner to use these resources when you understand what you need to create a successful project .

In resource management, the first thing is to consider which resources are important enough to control and manage for our company. While this looks quite easy at first glance, it can be very time consuming when all necessary resources are taken into account. In general, a resource can be defined as all the required things to finish a project on time. Therefore, depending on the type of the project, it can be a person or a worker, a machine, financial resources (funds), material, or anything.

In literature, resources are often described in units such as two welders or three computers. However, it is also possible to specify them in terms of the time they require, such as 16 welderhours or 24 computer-hours. In literature, another classification of resources can be made depending on their consumability. While some resources are considered as consumable (e.g. material), other resources, such as workers, can be defined as nonconsumable which can be used again and again during the project. Consequently, we may need to manage and assign the non-consumable resources effectively in order to complete the project on time. Therefore, in resource management, we are more concerned with non-consumable resources.

Another classification can be made depending on the importance of the resources. There are mainly three categories in this classification: key resources, secondary resources, and general resources. As it can be easily understood, key resources are the most important resources for our project. They are mostly expensive and scarce. The skilled workers or equipment can be named as the key resources for a project. Hence, we must pay more attention to these types of resources in the resource management process. However, we must keep in mind that a key resource for a project can be a secondary or a general resource for another project. Another category is the secondary resources which need less attention than key resources. One example of secondary resource is workers with regular skills. The last category is general resources which are mostly available all the time during the project, inexpensive, and easy to obtain. This type of resources is not the subject of the resource management process.

According to the APM (Association for Project Management) Body of Knowledge, which is the largest professional body of its kind in Europe, the resource management is ‘the acquisition and deployment of internal and external resources required to deliver the project, programme or portfolio’.

In project scheduling, start and finish time of each activity are determined by two different approaches: the forward-pass and the backward-pass. Both approaches utilize the durations of the activities, which means they assume that all the resources (for CPM, the durations of the activities) are available in hand before we start the project. However, this is not always the case. Thus, we need to find a proper way of managing resources in our project, which is also the main objective of the resource management process. Managing this process is very critical especially when we have limited resource capacity and when we need key and non-consumable resources for our project.

First, we start with determining the necessary sources for our project. In the second step, we classify them with respect to the given classes above such as consumable, secondary resources, etc. In the third step, according to the project scheduling, we must estimate the required quantity of each source determined in the previous step for all the activities. Finally, resource aggregation, leveling, and smoothing techniques can be applied, if necessary.

-Avoids unexpected delays: By developing resource management plans, necessary resources can be predicted, and the unexpected delays may be avoided.

-Prevents overloads and fatigue: Effective resource management allows us to prevent overloads of resources (fatigue for humans) and bottlenecks or roadblocks by using resource allocation, aggregation and leveling techniques.

-Builds transparency: Resource management provides transparent information about the status and workloads of resources and builds transparency for all the shareholders of the project.

-Measures efficiency: It allows us to measure the efficiency of resources and enable us to work on multi-project environment. It also helps us to calculate return on investment (ROI) ratio easily.

-Provides a safety net and projection: Resource management lets us know that we did the best with the available resources in hand and it offers the future projection for the upcoming projects.

There are three major constraints of a project: duration limitations, performance requirements, and the resource constraints,

Insufficient resource results in a longer project schedule and an ineffective resource management can easily affect the quality and the performance requirement of the project. Therefore, better strategies must be developed to manage the resources in a company.

The first step is the estimation of resources. In this step, the project managers estimate the type and amount of human resources, materials, machines, or any resources needed to accomplish each activity. The resource allocation is the second step of the resource management. In this step, resources, which are defined in the first step, are assigned to the specific activities in the project schedule. In the third step, resource aggregation is carried out. In this step, all necessary resources are summed up on a timeline which depends on the resource allocations carried out in the second step. The following step is the resource leveling step. In this step, we aim to minimize the fluctuations on resource requirements for activities throughout the project life cycle and to minimize the negative effects of resource demands. As an extension of resource leveling, the resource smoothing attempts to eliminate the peaks and troughs for resources. The last step is the resource forecasting which allows resource manager to anticipate the future resource requirements before a project starts.

• Expert judgment: One of the useful techniques to estimate the resources for each activity is to gather experts, who have done a similar project before and who knows which resources may be needed for this kind of a project.
• Published estimating data: Another good way of estimating resources is to look for published data of other projects such as articles, books, magazines, etc. This technique is widely used among the project managers to benchmark and compare the performance of their project and to estimate the future requirement of resources.
• Project management software: As already mentioned above, an intelligent resource management software, which lets you analyze the “what-if ” scenarios, can be very useful to estimate the resources required for future projects. Details about resource management software are provided in the following subsections.
• Bottom-up estimating: In this technique, activities are broken into pieces and resource requirements are estimated for these small pieces. These estimates are summed up to find the total estimate of the project. Even though it provides very accurate estimates, it is very time consuming since each activity in the project schedule must be assessed carefully. Therefore, if the project manager divides project into smaller pieces, it brings more accuracy, but at the same time more cost to the technique.
• Alternative analysis: There may be more than one way of accomplishing an activity in terms of the number and the kind of resources. Therefore, alternative analysis must be developed to decide which alternative is the most proper one for the project.

The resource allocation is the second step of the resource management. In this step, resources, which are defined in the first step, are assigned to the specific activities in the project schedule. At that step, we also determine the required number resources. However, multiple sources may be assigned to a specific activity, in addition to that, even the requirement for a specific resource may be different for each activity. For instance, some activities in the initial steps may need fewer workers, while the demand for workers may increase in the later stages. Moreover, a multi project environment can increase the complexity of resource allocation process since projects compete for scarce resources. Therefore, in this step of resource management, we try to optimize the utilization of these resources while we assign them to various project activities.

• Client Changes: Any changes in the scope, the due date or the budget can easily affect the current resource allocations. Hence, a good project manager must always be ready to adjust the resources with respect to the possible changes.
• Availability of Resources: Having multiple projects that share the same resources, broken machines, or sick workers force a project manager to monitor the resources all the time since availability of resources can suddenly change.
• Activity Predecessors: A project manager must pay great attention to the activity predecessors while allocating the resources. In most cases, there exist some activities in the project which cannot be started before some other activities are completed. In such cases, the resources to be used in these activities do not need to be prepared in advance.
• Changes in Priorities: Changes in the priorities among the projects is a common problem for a company if multiple projects run at the same time. In this situation, the resources, which a project manager has already allocated, may be needed by the other project that has a high priority for the company.

The third step of resource management is the resource aggregation. In this step, we sum the resources that are required to complete all the activities with respect to the resource allocation step outputs. Histograms are very practical to show the results of that aggregation process. For each resource estimated and scheduled in the previous stages, a separate histogram is required. In the resource aggregation step, using the same time unit with the allocation step also facilitates the summation process (Elbeltagi, 2009). This step is very vital when the same resources are shared among different projects in a multi-project environment. In these kinds of projects, the aggregated amount of a resource cannot be simply determined without using resource aggregation procedure.

In resource leveling, the aim is to solve the resource conflicts by shifting (mostly delaying) the dates of the tasks. By doing so, we try to get a smoother distribution of resource allocation. To identify the resource conflicts, we examine the network diagram in terms of slacks and floats, and determine the tasks that can be delayed to overcome the overallocations. At that point, it is preferable to check the noncritical tasks first, which does not change the overall schedule. Otherwise, resolving overallocation can result in delays in project completion date. Even though overallocation is a serious problem for a company, underallocation is also a case which must be examined carefully to improve the usage of specific resources. Therefore, in resource leveling, we are interested in both situations, and we aim to minimize the variations in resource usages along the project life cycle.

Step 1. Creating Resource Loading Table: As already mentioned above, the histogram can be used to show the hours of resource requirements throughout the project life cycle.

Step 2. Determining Activity Late Finish Dates: The second step is the determination of activity late finish dates by using the slack times and modifying the resource loading table.

Step 3. Identifying Resource Overallocation: After modifying the resource loading table with late finish dates, we are ready to identify the resource overallocations. At that point, we know how many resources we need in each period during the project life cycle. So, the question is whether we can supply that much resource for this project. If the answer is ‘no’, then we have a resource overallocation problem which must be resolved to complete the project on time and in the budget limits.

Step 4. Leveling the Resource Loading Table: This step is the main step of the resource leveling procedure. At that step, in order to eliminate the overallocation determined in the previous step, the resource loading table is reorganized iteratively.

• Skills needed for the project must be thoroughly understood.
• Strengths and weaknesses of the project team members must be clarified.
• Investigate the recent projects to determine the usage (over or underutilized) of the resources and use these data to predict the future resource requirements.

• Assign the right resources to right activity in the project plan.
• Statistics about the resources such as employee turnover rate, recruitment trends, and return on investment must be kept under control

Resource forecasting is the process of estimating the resource requirements of a company in a large timescale. Even though it is recommended to be done before a project starts, it can also be beneficial to do it after a project finishes to investigate the future projection of resources for upcoming projects besides predicting the resource constraints, unexpected costs, and possible risk areas. Different from the resource estimation process, in resource forecasting, instead of identifying the types, amount and characteristics of the resources needed to accomplish the activities in detail, we only draw the big picture about the resource requirements of the company in a large time base.